Towards The Global Games Market in 2017

A broad look at market growth by screen & region

CASUAL GAMES SEC TOR REPORT

What will the

$100bn Global
Games Market
look like in 2017?
Key aspects shaping the 2017
global games market:
1. Global

Globalization of the games market is accelerating as platforms and business

models become more aligned across all regions of the world. Free-to-play and
eSports have moved from East to West, and at the same time, the East is
opening up to Western IP and game devices. Mobile gaming has become the
truly global playground for developers.

2. China

Continued online connectivity and economic growth are increasing Chinas

influence on the games market in terms of leading companies as well as the
consumer market potential.

3. Mobile

Tablets and smartphones are quickly becoming a necessity for global

consumers, giving mobile games an immediate global mass audience to
entertain. Both devices have their own right of existence, doubling the
potential market size for mobile games in the future.

4. Screens

Understanding change on a global as well as local scale requires a consumerdriven viewpoint. Technical segmentation of the market disguises growth
factors and gives no hints about the potential size of individual markets in
the future.

5. Media

Free-to-play business models and the addition of mobile screens as game

destinations lower thresholds and allow consumers to spend more time on
games. Ultimately this is the only way to get non-paying gamers to start
spending and expand the wallet of current paying gamers. In the same
manner, time spent on game brands through other media will lead to higher
game industry revenues in the West.

6. Brands

As games branch out to all media and entertain mass audiences, they
become more than games but entertainment brands. A quarter of Western
gamers play games on all four screens. Consumers are increasingly expecting
games and media content related to their favourite games to travel with
them across all screens and to be available at all times.

Asia and other growth

regions will take 51%
of the global market
in 2017. A key driver
for growth in mature
Western markets is
time spent, as games
branch out to all media.

GLOBAL
MARKET

Global Games Market in 2017

US, Western Europe and Oceania

currently account for 51% of the
global games market 2013 & 2017
USD $75.5bn (billion) global
games market with Asia, Eastern
CAGR
Europe, LATAM & MEA making up
$ 75.5*bn
$ 102.9*bn
+8.1%
the remaining 49%. Over the next
NAM, W-EU, OCEANIA
ASIA, E-EU, LATAM, MEA
three years, this split will reverse
as growth regions, with a
Compound Annual Growth Rate
CAGR
(CAGR) of 12.5%, drive global
+3.3%
revenues past the USD $100bn
51%
49%
57%
43%
mark. Growth in these regions
$ 37.0bn
$ 59.0bn
$ 43.8bn
$ 38.5bn
CAGR
will be fuelled by increasing
internet and smartphone
+12.5%
penetration along with increasing
wealth. The relatively saturated
markets of North America,
*New figures following final analysis of (company) revenue data in Q1 2014
Western Europe and Oceania will
Source: Newzoo 2014 Global Games Market Report & Service
experience more modest growth.
Currently, 40% of all game revenues are generated on the Computer Screen, making it the most lucrative
followed by the Entertainment Screen with 31%. By 2017, the PC Screen will continue to dominate, led by
MMO games. The Entertainment Screen share will shrink to 24%, with the Personal Screen growing to
account for 22% of all revenues. The decline of handhelds will be offset by a growth in tablet gaming,
with the Floating Screen taking 14% of revenues in 2017.

2013

2017 by Screen & Segment

9%

24

40%

23%

Total
$ 102.9bn

14

17%

Source: Newzoo 2014 Global Games Market Report & Service

12
%

40%

Total
$ 75.5bn

TV / Console
$24.3bn

24

MMO, PC & Webgames

Computer Screen

%
31

Smartphones
Personal Screen

(Mid)-Core
PC Games
$8.2bn

8%

Consoles & Other TV

Entertainment Screen

MMO
$23.5bn

22%

12
%

2013 by Screen

Webgames
$9.3bn

global game revenues per screen

Tablets & Handhelds

Floating Screen

2017

22%

Handheld
Console
$2.3bn
Tablet
$12.9bn

Mobile Phone
$22.4bn
Towards The Global Games Market 2017 Ca s ua l G a m e s A s s o c i at i o n 3

Global Growth Dynamics

Growth dynamics are
different for the mature
Western regions of US,
Western Europe and
Oceania than in the rest of
the world. In Asia, Eastern
Europe, Latin America,
Middle East and Africa
population and economic
KPIs drive organic growth.
In the mature markets,
smartphones and tablets
allow gamers to spend more
time, a necessity for
further growth. As games
also branch out to other
media, growth will
continue at a healthy pace
towards 2017.

online connectivity & economic growth

Source: Newzoo 2014 Global Games Market Report & Service

growth per region and selected segments

Global 2013-2017 CAGR: 8.9%

Total
CAGR
5.0%

Total
CAGR
3.1%

Total
CAGR
12.1%

North America
Mobile Phone
CAGR +15.7%
Total
CAGR
13.8%

Latin America
Tablet
CAGR +61.0%
Source: Newzoo 2014 Global Games Market Report & Service
4

Middle East,
Africa & Europe
Handheld Console
CAGR -22.0%

GLOBAL
MARKET

Time & Media Expand Potential

In mature game markets such
as North America and Western
Europe, where the internet
population is almost at its
max and the economy is in a
recovery phase, an increase in
revenues will have to come
from current gamers.
To convince more gamers to
start spending money and
paying gamers to dedicate a
higher share of their leisure
budget to games, time spend
will become the determining
factor. Time spent gaming
ultimately represents
entertainment value.

more screens leads to more time spent on games

Gamers Playing
on All Four Screens
2013
Floating
Screen

Entertainment
Screen

Western Europe*
22% | 34M

Computer
Screen

+43%
Personal
Screen

* As aggregate of UK, GER, FR, NL, BE | Source: 2014 Newzoo Data Explorer, Trend Analysis

Licensing / Merchandise
Advertising
TV, Video, Events
Hardware

Game
Revenues
2017:>$100bn

Source: Newzoo

+39%

NAM
24% | 41M

the broader picture: games branching out

Industry growth
2017:>$200bn?

Increase in time
spent on games
2013 vs 2011

The arrival of smartphones and tablets as

gaming devices has made it easier for
gamers to spend more time playing games.
The dominance of the free-to-play
business model on all screens except the
Entertainment Screen, adds to this. The
fact that game-related video content and
streams are the most popular content on
the web shows how games are impacting
all media and creating new revenue
streams. The explosion of eSports
popularity, including huge live events, is
another direction in which games are
branching out in the West. Through all
media, games and game brands reach a
mass audience opening up new
advertising, licensing and merchandising
possibilities. Taking hardware sales into
account, the total size of the industry
could grow to twice the revenues
generated directly by games alone.

Towards The Global Games Market in 2017 Ca s ua l G a m e s A s s o c i at i o n 5

Games Become Media Brands

use of other digital content amongst gamers US & W-EU
Total
Population

All
Gamers

Paying
Gamers

78%
70%
59%
50%
34%

49%

51%
43%

40%

Live video streams

86%

62%

43%

61%

Music streaming

75%

69%

79%

Online video

eBooks

Digital News / Magazines /

Blogs

Source: 2014 Newzoo Data Explorer

Games are one of many forms of digital content that

todays gamers can consume. In fact, gamers are more
likely than the general population to use all forms of
digital content, and these differences are even more
apparent when it comes to paying gamers. Music
streaming for example is done by 78% of paying
gamers, compared to 61% of the general population.

This difference is even more pronounced for

online video which is watched by 49% of the total
population and 69% of paying gamers. Both music
and videos can be used to enrich the gaming
experience, but these differences also extend to
non-gaming related digital content, such as
eBooks.

eSports is long established in Asia

and is now breaking off this niche eSports viewership and participation amongst gamers
and into Western markets. In
terms of awareness, engagement
50%
50
and participation, the West still
US & W-EU
has some catching up to do. Half
Asia & E-EU
40
of US and Western European
28%
gamers are aware of the
30
25%
25%
phenomenon, compared to 75% in
21%
20
Asia and Eastern Europe. An
11%
11%
impressive 32% of Asian and
9%
10
6%
Eastern European gamers watch
4%
3%
2%
1% 2%
eSports, compared to 13% in the
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Source: 2014 Newzoo Data Explorer

GLOBAL
MARKET

Game Brands Travel Across Screens

Candy Crush, Minecraft & Call of Duty,
show very different patterns when
looking at the screens they are most
played on. Candy Crush, a typically
casual game, is most played on
smartphones closely followed by the
PC. The TV screen is extremely
dominant for the core title CoD
(85%) while the PC (36%) and TV (46%)
are both popular choices for Minecraft
gamers. It seems the PC is the most
versatile platform, catering to each
game genre.

franchises and screens most played on*

43%

37%
20%
0%

84%

9%

Not surprisingly, the most enjoyed

aspect of Nintendos Sonic title is that
its fun and easy while Resident Evil
gamers most enjoy the suspense and
violence. Being the hero and the
satisfaction of mastering the game
are almost equally important to both
types of gamers, suggesting these
aspects are universal to good
gameplay, regardless of game genre.

7%

0%

36%

46%

13%

5%

*Based on consumers in US, UK, FR, GER | Source: 2014 Newzoo Franchise Profiles
27%

top 10 most enjoyed aspects*

15%

14%

11%

12%

11%

9%

9%

10%

9%

8%

7%

6%

4%

9%
5%

5%

8%

5%

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3%

*Based on consumers in US, UK, FR, GER | Source: 2014 Newzoo Franchise Profiles
Towards The Global Games Market in 2017 Ca s ua l G a m e s A s s o c i at i o n 7

Mobile: The Truly Global Playground

mobile gamers 2013-2017
NAM, W-EU, OCEANIA
400
350
300
250
200
150
100
50
0

355M

301M

+18%
2013

2017

LATAM, E-EU, MEA, APAC

2,000
1,500
1000

1,463M

1,029M

+42%

500
0

2013

2017

The growth of gaming on smartphones and tablets

continues to exceed all expectations. Final reviews of
2013 mobile revenues were adjusted upwards by analysts
and are widely acknowledged to have surpassed USD
$17bn, or 23% of the global games market. In 2017, mobile
game spending will surpass USD $35bn or 34% of the total
market. Contrary to consoles, but similar to PCs, mobile
devices are used on a global scale and seen as a necessity
by an increasing share of the global population. The
Google Play and iOS appstores demonstrate the global
reach of mobile gaming, with countries from all regions of
the world coming together in the top-grossing rankings.
The number of mobile gamers is expected to increase from
1.33bn in 2013 to 1.82bn in 2017. The figure to the left
shows a growth percentage of 18% for Western mature
markets and 42% for Asia, Eastern Europe, MEA and
LATAM combined.

Source: Newzoo 2014 Global Games Market Report & Service

mobile country rankings march 2014 | year-on-year change

iPad

These rankings
are based on
revenues
generated by
the top 1000
games per app
store.

Notable developments
outside of top 10

US

Japan

Japan

UK

US

US

Australia

China

Korea

China

UK

Germany

Japan

Australia

Taiwan

Canada

Canada

UK

Germany

France

France

Russia

Germany

Russia

France

Korea

Australia

10

Italy

10

Taiwan

10

Canada

Korea dropped from charts

Thailand new at #18

Source: 2014 Newzoo / Distimo Monthly Rankings

8

Play Store

iPhone

HongKong climbed 4 places to #12

Switzerland new at #13

new

Indonesia now in charts at #20

Sweden dropped 3 places to #18

GLOBAL
MARKET

Mobile Gamer Profiles

The majority of mobile gamers in both Japan and

South Korea are males aged between 21 and 35. In
South Korea, males aged 36 to 50 make up the next
largest segment but in Japan it is 21 to 35 year old
females. Females make up a slightly higher
proportion of Japanese (46%) than South Korean
mobile gamers (44%).

age and gender | mobile gamers

11% 14%
22%

Japan

13%

26%

Mobile phone brand preferences differ greatly

between the Asian countries. 54% of South Korean
mobile gamers own a Samsung phone and just 12%
own an iPhone while one third of Japanese mobile
gamers own an iPhone and just 7% owns a Samsung.

15%

14% 13%
18%

South
Korea

12%

Role Playing games are much more popular with

Japanese gamers (31% vs. 17%) while South Korean
gamers are more likely to enjoy racing games (22%
vs. 14%).

23%

20%

phone ownership | mobile gamers

Source: 2014 Newzoo Data Explorer

preferred genres | mobile gamers

South Korea

Japan

31%

28%

26%
22%

24%
20%
17%

14%

16%
10%

7%

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Source: 2014 Newzoo Data Explorer

Source: 2014 Newzoo Data Explorer

Towards The Global Games Market in 2017 Ca s ua l G a m e s A s s o c i at i o n 9

Chinese Games Market Growth

chinese games market growth | 2008-2013

RMB 83.2
($13.8)

RMB and USD $ revenue in billions. Source: GPC China Games Market Report, December 2013

The Chinese games market has shown considerable

growth over the past number of years. Between 2008
and 2013, revenues more than quadrupled to reach
RMB 83.2bn (USD $13.2bn). Between 2012 and 2013,
there was 38% year-on-year growth, according to GPC.

chinese payers per segment*

Female

Male
56%

55%
48%

44%
34%

lo
ad

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PC
/

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MM

le

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/
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su

32%
25%

42%

*Based on active gamers aged 10-50

Source: 2014 Newzoo Data Explorer
10

39%
33%

wn

39%

Do

47%

cia
l

Looking at the % of payers per segment,

mobile and MMO score the highest for both
male and female payers. Of Chinese mobile
players, 56% of men and 48% of women pay
and this is 55% and 42% for MMOs. Chinese
boxed PC/mac gamers are the least likely to
pay, with 33% of men and 25% of women
doing so. This is likely due to the popularity
of free, unofficial versions of Western PC
titles.

Domestically-developed games accounted for

RMB 47.7bn (USD $7.9bn) of these revenues,
representing 57% of the market and a 29.5%
year-on-year increase.

GLOBAL
MARKET

China Insights
Due to strict censorship rules combined with serious
piracy issues, there are very few Western companies that
publish Chinese versions of their games. Nevertheless,
Western single player titles are hugely popular among
Chinese gamers and are readily available to download for
free from various websites. In total, there are 7,231
single player games available for free download on
Ali213.net, with the vast majority comprising of foreign
single-player console and PC games that have not
officially entered into China.

downloads in China on Ali213.net

In general, Western games are rated very highly on the

site, with criticism focusing on the low quality of the
localization that is provided by the websites. When the
non-official localization is done well, downloads are
much higher. Monetization of high quality Western
games can be achieved by a combination of working with
a respected local partner, integrating in-game spending
models and localizing the game in Chinese from day one.
Source: Newzoo 2014 Introduction to the Chinese Games Market

major android app stores in China

360Mobile Assistant

Launched in 2011 by Qihoo 360, a

leading (mobile) internet security
company.

Tencent MyApp

Tencent released its new version

5.1 of WeChat exclusively through
Tencent MyApp to attract users.

Wandoujia

Has over 300 million users and

daily app downloads exceed 30
million.

UC AppStore

Launched by UC Web, a provider

of mobile internet software
technology and services founded
in 2004.
Source: Newzoo 2014 Introduction to the Chinese Games Market

The Baidu app store

Owned by Chinas leading search

engine Baidu.

AnZhi Market

As of Q3 2013, AnZhi Market had

120 million users, of which 60%
are active.

Alibaba

Chinas largest e-commerce

company, announced it is building
a platform to promote and
distribute third-party mobile
games.

Gfan Market

Total number of downloads to date

is more than 3 billion, with 10
million new downloads everyday.

In 2012 and 2013 the

Chinese App ecosystem
underwent dramatic change.
A small number of leading
Android appstores emerged
facilitating discovery and
distribution, and payment
channels became more user
friendly and secure. This
helped generate massive
growth of the app economy,
in particular for (locally
developed) Android apps.
The market structure
remains very different from
the West. Google Play for
example, is not widely
available and Amazon only
launched in 2013.

Towards The Global Games Market in 2017 Ca s ua l G a m e s A s s o c i at i o n 11

See you in San Francisco

Casual Connect USA will return to San Francisco this July
22 - 24, 2014 at the Hilton San Francisco in Union
Square, in the centre of the city. Casual Connect USA is
now open for registration and sponsorship. Please visit
the website to ensure you get involved with this event
that is anticipated to be nothing less than epic.
http://usa.casualconnect.org

For press inquiries, please email

jessica@casualgamesassociation.org
Learn more about the games industry with the best
speakers, networking, lectures and data to help you
succeed in a crowded market at:
Casual Connect USA in San Francisco: July 22 - 24, 2014
Casual Connect EE in Belgrade: November 10 - 12, 2014
Casual Connect Europe in Amsterdam: Feb 4 - 6, 2015
Casual Connect Asia: May 2015

Casual Connect USA Returns to San Francisco

22 - 24 July 2014

About Newzoo
Newzoo is an international full service market
research and consulting firm, focused
completely on the games industry. It provides
independent market data across all game
segments, business models and regions of the
world based on a unique combination of
primary consumer research, transactional data
and financial analysis.

About the Casual Games Association

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